Japan’s main securities watchdog, the FSA, claims that XRP is not a security since the token does not meet the definition of security under Japanese law. Does XRP finally win one?
XRP is not a security!
It’s worth remembering that the US SEC sued Ripple, the crypto firm behind XRP. The regulatory body noted that the company “Participated in this illegal offering of securities from 2013 to the present” in which “Was able to raise at least $ 1.38 billion selling XRP” without being registered.
Accordingly, the US SEC notes that XRP is a security and therefore must be registered under that category, something that Ripple did not do.
But, unlike regulators in the United States, Japan established that XRP does not fit the definition of a security under Japanese law.
“The FSA considers XRP as a cryptocurrency based on the definitions of the Payment Services Act”, the Japanese regulator told The Block.
However, the fact that Japan considers XRP to be a cryptocurrency and not a security has nothing to do with the allegation by the SEC against Ripple. Also, the US ranking on XRP is not likely to affect how Japan views crypto.
What will happen to Ripple?
So while many would like it to be different, Japan’s listing against XRP does not eliminate Ripple’s problems. Obviously, if we are in a different scenario in which Japan also considers crypto as a value, the problem would be much greater.
In this way, the future of Ripple is quite uncertain. As we have previously reported, many crypto exchanges have stopped XRP trading.
Nonetheless, over the years, Ripple has managed to build a loyal user base for XRP. Still, the lawsuit has managed to raise concerns.
According to CoinDesk, Okurisan, a Japanese XRP investor, said that “many people are sad about the SEC problem these days … I am very concerned.” But, with all this, the Japanese investor believes that the crypto will be able to recover.
Thus Japan has become a key country for Ripple and XRP, so much so that it is among the countries that Ripple has considered moving.